Earlier this month, Icelandic resident Hjörtur E. Kjerúlf was having coffee in his house near Lake Lagarfljót, when he spotted something moving in the water. He immediately picked up his camera and started recording (link: Iceland Review). Below is the video he took.

Is it evidence of the existence of the Lagarfljót Worm -- the giant worm monster said to live in Lake Lagarfljót? Or is it just a piece of fishing net floating in the water?

The worm monster, or Lagarfljótsormur, is Iceland's equivalent of the Loch Ness Monster. The legend of it is centuries old. Wikipedia offers this account of the creature's origin:

According to the folk tradition recorded by Jón Árnason, the great serpent in Lagarfljót grew out of a small "lingworm" or heath-dragon; a girl was given a gold ring by her mother, and asked how she might best derive profit from the gold, was told to place it under a lingworm.[1] She did so, and put it in the top of her linen chest for a few days, but then found that the little dragon had grown so large, it had broken open the chest. Frightened, she threw both it and the gold into the lake,[2] where the serpent continued to grow and terrorized the countryside, spitting poison and killing people and animals.

"...where the serpent continued to grow and terrorized the countryside, spitting poison and killing people and animals", until more recently, when it's been content to do little except show itself in a grainy film.